1. 1 1 December 2007 Investor Presentation

2. 2 2 Among the most competitive steel companies in the world Strong low cost structure as a result of diversified production processes and multiple raw material sourcing An international company Large export revenues from Brazil Operations in 13 countries Ranked 14 th globally by steel output for year 2006 with an output of 15.6 million tonnes (source: International Iron and Steel Institute - IISI) Largest long steel producer in the Americas 2 nd largest long steel producer in North America 41 steel units with state of the art technology 2 nd largest SBQ producer in the world Relevant market share and diversified product range through downstream and service centers Strong balance sheet and strong cash generation Gerdau S.A. shares are listed on the São Paulo, New York and Madrid Stock Exchanges Highlights

3. 3 3 Industry Overview Group Overview Operating and Financial Highlights Agenda All data presented in US Dollar and in metric tons, except when indicated

4. 4 4 China Growth 1993 to 1999 = 5.5% p.a. China Accelerated Growth 2000 to 2007 = 21.2% p.a. Crude Steel Production * Annualized Production 9M07 Source: IISI / World Steel Figures 2007 In million tonnes Growth rate in the last 10 years: + 65% China: + 347% World Growth 2000 to 2007 = 6.5% p.a. World Growth 1993 to 1999 = 1.4% p.a.

5. 5 5 Demand 1,113 1,179 1,251 e: estimated Source: IISI 5.9% 6.1% FINISHED STEEL APPARENT DEMAND In million tonnes FINISHED STEEL APPARENT PER CAPITA DEMAND (kg) The world steel demand should increase 4.2% p.a. from 2010 up to 2015. STEEL USE PER CAPITA GROWTH (2002 – 2007) NAFTA: +5.7% China: +104.1% Brazil: +12.8% World: +54.5% India: +50.0%

6. 6 6 Crude Steel Production – 2006 Source: IISI Ranking In million tonnes Ukraine China USA Japan Russia Germany Brazil Italy South Korea Global Production: 1,230 MMt China: 34% of global production Brazil: 2.5% of global production Others 10th Largest Producer India Turkey Taiwan

7. 7 7 Production in 1990 770 million tonnes Production in 2005 1.139 billion tonnes Consolidation Global Steel Market Source: Prof. Germano de Paula TOP 5: 12.3% (1990)16.9% (2005) TOP 5: 13.4% (1990)24.4% (2005) EX-CHINA WORLD

8. 8 8 Industry Overview Group Overview Operating and Financial Highlights Agenda All data presented in US Dollar and in metric tons, except when indicated

9. 9 9 100+ Years in Business 19001940´s1950´s1960´s1970´s1980´s1990´s2000 1901 - First Operation: Nail Factory 1948 - 1 st Steel Mill Acquisition (Riograndense) Expansion of Riograndense Mill (Construction of 2 nd steel mill) Distribution channel arrangements (today: more than 70 sales points) Market Share increase by: Diversification / Verticalization Distribution channel New acquisition (Pernambuco, Brazil) Acquisition of a new steel mill (Paraná, Brazil) Construction of a new mill (Rio de Janeiro, Brazil) Entering in the Reforestation business Acquisition of 3 mills (Rio de Janeiro, Minas Gerais and Bahia, Brazil) Construction of 2 mills (Paraná and Ceará, Brazil) International expansion (Uruguay and Canada) New Acquisitions: Piratini (Rio Grande do Sul, Brazil) – specialty steel Second mill in Minas Gerais and rolling mill in São Paulo (Brazil) Stake in Açominas International expansion ( Chile, Canada, Argentina and USA) New Acquisitions: USA Downstream mills and fab shops in North America Entering European and Asian market Expansion in Latam market Construction of steel mill in São Paulo (Brazil)

10. 10 Installed Capacity Expansion MacSteel (USA) Sidertul (Mexico) INCA (Dom. Rep.) Sizuca (Venezuela) SJK (India) Chaparral (USA) 1980 – Laisa (Uruguay) 1988 – Barão de Cocais (Brazil) 1989 – Usiba (Brazil) Cambridge (Canada) 1992 – Piratini (Brazil) AZA (Chile) 1994 – Pains (Brazil) Manitoba (Canada) Stake in Açominas (Brazil) Ameristeel (USA) AZA New mill (Chile) Additional stake in Açominas (Brazil) North Star (USA) Control of Açominas (Brazil) Co-Steel (USA) 7,696 11,076 16,372 Diaco (Colombia) 16,475 4,556 19,870 São Paulo (Brazil) Sidenor (Spain) Sheffield (USA) Siderperú (Peru) GSB (Spain) Solid Track Record 27,580 23,175 TOTAL INVESTED(1997 – Sep. 2007): Brazil = US$ 4.2 billion + Debt North America = US$ 6.1 billion + Debt Latin America = US$ 1.3 billion + Debt Europe = US$ 687 million + Debt Asia = US$ 71 million + Debt In thousand tonnes (IFRS) Abroad – Crude Steel Installed Capacity Brazil – Crude Steel Installed Capacity e: estimated In addition to the mills acquired, as related above, Gerdau acquired many fab shops in order to add value to its products and offer services and products to its clients according to their needs. CAGR 1997-2007: 18% a.a.

11. 11 Spain Dominican Republic Steel Units Associated Companies Joint Ventures BRAZIL 9.9 million tonnes of crude steel 6.6 million tonnes of rolled steel products 11 Steel Units 12 Fabrication Shops - Armafer 04 Downstream operations and special sections 68 Sales point (Comercial Gerdau) 04 Flat steel service centers ABROAD 13.3 million tonnes of crude steel 13.9 million tonnes of rolled steel products 30 Steel Units 45 Fabrication Shops 20 Downstream operations and special sections 02 Associated Companies (Spain and Dominican Republic) 02 Joint ventures (USA and India) Canada United States Mexico Venezuela Colombia Peru Chile Brazil Argentina Uruguay India Location

12. 12 Growth with Profitability ATKearney study Notes: 1) EBIT-growth Notes: USINAS = USIMINAS; ARCELOR Takeover MITTAL/ SEVERSTAL: The market capitalization of Severstal is 6.8 bn USD (same as revenue, hence valued above the industry multiple of 0.79) Source: Thyssenkrupp: steel segment

13. 13 LONG STEEL PRODUCTS (Brazil) Maintenance of market share Improvement of current installed capacity SPECIALTY STEEL Active role in the steel sector consolidation process Search for new opportunities AÇOMINAS New 1.5 MM tonnes blast furnace Growth platform for slabs, blooms and billets Iron Ore Reserves Growth Opportunities LATIN AMERICA Maintenance of leadership in the long steel sector New markets NORTH AMERICA Efficiency and productivity gains (Gaps) Enhancement of leadership in the long steel sector through acquisitions

14. 14 Outlook BRAZIL Strong demand for the 4 th quarter 2007 and throughout 2008 Scrap prices stable; iron ore and coal prices aligned to international market Maritime freight should continue to be high, squeezing export margins NORTH AMERICA Government should continue investing in infrastructure Prices relatively stable Lower volumes during the next quarter due to impending winter period Chaparral consolidated since September 14 th Good prospects for early 2008 LATIN AMERICA Demand should continue strong impacted by economic growth in the region Government investments should continue Costs may increase EUROPE Demand should continue strong Increase in production due to investment plan in progress Higher costs, mostly energy

15. 15 Industry Overview Group Overview Operating and Financial Highlights Agenda All data presented in US Dollar and in metric tons, except when indicated

16. 16 Shipments Billets, blooms & slabs Merchant bars Rebars Fabricated steel Heavy structural shapes Wire-rod Wires Nails Brazil – Domestic Market (31% in 3Q07) In thousand tonnes (IFRS) Brazil – Exports (11% in 3Q07) Latin America (15% in 3Q07) North America (39% in 3Q07) Europe (4% in 3Q07) 9M07 = 12,544 +12.4% 9M06 = 11,162 3,689 3,770 3,727 3,703 4,1644,168 4,212

17. 17 Net Sales Breakdown Net sales from the overseas units plus exports from Brazil, represented 66% of consolidated net sales Net Sales Breakdown by Region - 9M07 Historical Net Sales Geographical Distribution In US$ millions (IFRS) Brazil - Domestic Market 34% North America 36% Europe 11% Latin America 11% Brazil – Exports 8% Exports from Brazil (t) Africa 12% Central America 16% South America 23% North America 13% Europe 12% Asia 24% 3,038 3,030 3,577 3,915 4,168 13% in tonnes

18. 18 GROSS MARGIN* EBITDA MARGIN* EBITDA and Margins EBITDA* In US$ millions * Data in IFRS North America Brazil Latin America Europe 734 614 742 829 823 Consolidated Brazil North America Latin America Europe 8% 10% 26% 56%

19. 19 Consolidated Financials In US$ millions (IFRS) LTM = Last twelve months EBITDA = Earnings before interest, taxes, depreciation and amortization

20. 20 DEBT STRUCTURE Domestic Currency 19% Foreign Currency 22% Companies Abroad 59% DEBT AVERAGE LIFE: 7 years and 7 months September 2007 (IFRS) Consolidated Debt Profile COST OF DEBT (p.a.) Brazil Domestic Currency9.6% Foreign CurrencyFX + 6.4% Companies Abroad7.1%

21. 21 FINIMP: 51 BNDES: 46 Pre-export: 45 BNDES: 319 Companies Abroad: 83 In US$ millions – September/07 (IFRS) FINIMP: 55 BNDES: 46 Companies abroad: 1,259 (BRIDGE) FINIMP: 69 BNDES: 48 BNDES: 178 FINIMP: 214 Companies Abroad: 84 Companies Abroad: 699 SHORT TERM: US$ 2,304LONG TERM: US$ 6,602 Consolidated Debt Amortization Perpetual Bond: 600 Companies Abroad: 2,982 Debentures: 166 BNDES: 154 FINIMP: 127 Companies Abroad:232 BNDES: 47

22. 22 ACTUAL 9M07 (IFRS) INVESTMENT PLAN 2007–2009 In US$ millions CAPEX In US$ millions BRAZIL7290 ABROAD3164,8735,189 North America1374,2834,420 Latin America130494624 Europe492574 Asia071 TOTAL1,0454,8735,918 CAPEX ACQUISITIONS 9M07 200720082009TOTAL BRAZIL8205701,0002,390 ABROAD580530 5001,610 North America260360 315 935 Latin America260125 142 527 Europe 60 45 43 148 TOTAL1,4001,1001,5004,000 * MacSteel is not included

23. 23 Quanex Corporation (MacSteel) One of the largest SBQ producer in the world and a strong presence in the North American market Possibility in increasing the presence of the Gerdau Group in the automotive and autoparts industry as a supplier of long specialty steel products (SBQ) Annual installed capacity: 1.2 million metric tons of crude steel and 1.1 million tons of rolled products Three mini-mills, located in Jackson, Michigan; Monroe, Michigan; and Fort Smith, Arkansas Six downstream operations located in the states of Michigan (two), Ohio, Indiana (two) and Wisconsin 1,600 employees Investment: US$1.458 billion – US$39.20 per share – plus the assumption of liabilities of US$215 million The acquisition will be paid through cash available Quanex will spin-off its non-steel business Quanex Corporation’s Board of Directors has unanimously approved the transaction on November 18. The shareholders still must to approve the offer.

24. 24 Quanex Corporation (MacSteel) STRENGTHS Strong and resilient financial performance Cost structure (lowest SBQ producer in North America) High productivity Good management team Long standing customer base Plant located close to the main SBQ markets (Midwest, Texas and Mexico) State of the art downstream Value added processing facilities Strong brand recognition Common values to Gerdau OPPORTUNITIES Best entry opportunity in the high end SBQ market ( if not the one in the medium term) Strategic fit to Gerdau SBQ strategy (be one of the global leaders in the automotive market) Synergies with Gerdau

25. 25 BOARD OF DIRECTORS - External members on the board - Support Committee (Support and Excellence; Corporate Governance; Strategy and Compensation and Succession) EXECUTIVE COMMITTEE - Vice-presidents responsible for the Operations and Support Areas - Support Committee ( Disclosure, Financial, Risk Management and Human Resources and Orgazational Development) FISCAL BOARD (AUDIT COMMITTEE) - Permanent and in accordance to the SOX (Gerdau S.A.) Gerdau S.A. shares are included in the following São Paulo Stock Exchange indexes: Bovespa Index - Ibovespa Corporate Sustainability Index - ISE Special Tag Along Stock Index - ITAG Brazil Index 50 – IBrX 50 Industrial Sector Index – INDX HIGHLIGHTS: First Brazilian company to submit its Consolidated Financial Statements in conformity with international accounting standards (IFRS) Tag Along (100% common and preferred shares) Bovespa Level 1 Shares are negociated in Bovespa, Nova York Stock Exchange, Toronto Stock Exchange and LATIBEX Stock Exchange Risk Management Gerdau Business System Governance – Best Practices

26. 26 Disclaimer This document can contain statements which constitute forward-looking statements. Such forward-looking statements are dependent on estimates, data or methods that may be incorrect or imprecise and that may be incapable of being realized. These estimates also are subject to risk, uncertainties and suppositions and include, among other, overall economic, political and commercial environment, in Brazil and in the markets we are present in addition to government regulations, present and future. Prospective investors are cautioned that any such forward- looking statements are not guarantees of future performance and involve risks and uncertainties. The Company does not undertake, and specifically disclaims any obligation to update any forward-looking statements, which speak only as of the date made.

27. 27 www.gerdau.com.br inform@gerdau.com.br +55 51 3323 2703